AG report reveals ballooning public debt –loan agreements withheld from parliament
GUYANA’s public debt was almost three times what the country was earning by the end of 2013, a whopping $380B, almost US$2B.This was disclosed in the now public Auditor General’s (AG) Report on Government’s expenditure for the year 2013 and was released by Speaker of the National Assembly, Dr. Barton Scotland, when the House met on Thursday last. Auditor General Deodat Sharma found too that in 2013, the now ousted People’s Progressive Party/ Civic (PPP/C) Administration had secured almost $50B more in external loans, but presented the information for less than half of this to the legislature. Sharma in his report said that the Guyana Constitution and External Loans Law stipulate mandatory reporting of all agreements regarding any such loans to the National Assembly, “as soon as practicable after the execution of such agreements.” The Auditor General in his examination of Government’s financials found that in 2013, the PPP/C Administration contracted five large external loans amounting to just about $49.5B. He found however, that only three loans totalling $22.2B and their related agreements were laid in the National Assembly. The PPP/C Administration presented reports for loans from the CDB, $7B for the West Coast Demerara (WCD) Road Improvement Project ; another $1.5B from the CARICOM Development Fund—to which Guyana is an annual contributor — for the upgrading of all-weather access roads to weather -paved roads; and another $13.6B for road networks upgrade and expansion. The auditor general found however, that the then administration failed to present to the House, the loan agreements for $3.8B from the Inter-American Development bank (IDB) for the “Environment Sector Strengthening Programme.” The other outstanding loan agreement, according to Auditor General Sharma, was in relation to the supply of crude oil, refined oil products and LPG of up to 5,200 barrels per day on an annual basis, a whopping $23.7B. The $23.7B loan was contracted with Venezuela under what has become known as the Petro Caribe Agreement Only recently, Minister of State Joseph Harmon confirmed that the incoming administration found that the fund which had been set aside with monies accrued under the Petro Caribe initiative with Venezuela, was bankrupt. In his report, the auditor general did point out a $14B decrease in Guyana’s public debt over the previous year he reported on 2012, but explained, this decline was due mainly to a substantial debt write- off and the movement of the foreign exchange rate, coupled with some payments made. Guyana’s public debt at the end of 2013, according to Auditor General Deodat Sharma, stood at some $380B, while the country had earned only $136B.